Joanne Latimer
Citizen Special
Saturday, January 17, 2009
Divorce may be a personal tragedy, but it was the best thing that happened to real estate.
'Happy couples move up and unhappy couples move out';Pamela Cyr Montreal Realtor
Photograph by : I-Stock.Com and Dennis Leung,
The Ottawa Citizen
"In the 1970s and 1980s, it created a new demographic of middle-aged people who were on the move," noted seasoned Montreal realtor Pamela Cyr, my agent and trusted confidant. "Women entered the workforce, which changed everything. They had their own income and they didn't stay in bad marriages.
It's rare to find couples who stay in the original marital home for 30 years anymore. Happy couples move up and unhappy couples move out."
After 25 years in the business, Cyr has seen affairs of the heart -- both sweet and sour -- create unexpected opportunities in real estate.
Divorce is the wild card, as is passionate love. When marriages go down in flames, the house goes on the market and prices are sometimes slashed. Tears are shed, hearts mend and the cycle starts again.
The cycle revs high after the holidays, when many unhappy couples throw in the towel.
The stress of acting civilized in front of house guests creates a perfect storm for bad marriages. All hell breaks lose after Christmas, notes well-known Montreal divorce lawyer Andrew Heft.
"Starting around Jan. 5, we get a lot of calls. It happens every year.
"The holidays are like a pressure cooker. When they're over, the lid blows off. That's when the assets, like the house, become an issue."
The love-torn nature of real estate was abstract to me until I bought my first home with my (first) husband. We found a starter condo for sale and made a bid.
Tossing and turning in bed that night, I disturbed my husband by reviewing the moral aspects of the situation: We knew the seller had fallen madly in love and bought an expensive home, so his motivation to sell was high. We knew he couldn't afford to carry two mortgages any longer. Was it wrong to take advantage of the situation with a low-ball offer?
Not according to the seller. Philippe Daviet, known as the vendor in these transactions, was thrilled to unload his first house -- even at $44,000 less than the original asking price.
"I had bought it nine years ago with my first wife, so it had some bad memories," explains Daviet, a software executive. "It was time to make new memories with my girlfriend, Estelle, in a bigger home.
"We found the perfect home near the Atwater Market and made an offer, waiving the conditional clause to sell the first property.
"I had to mortgage the first house to make the down payment on the bigger home. That left me with $50 in my pocket each week, for three months. I was so relieved to sell!"
Guilt fully assuaged, I slept soundly.
Cynthia Taylor has a different perspective on low real estate offers. The sale of her home in Lindenlea wasn't so joyous. "I got hosed," declares the marketing consultant. "I got hosed because I was divorcing. We should've fought for the full value of our house, but there was no working 'we' at that time and our agent was double-ending in a questionable fashion.
"We found out a few years later that our agent told the buyers that we didn't do any of the upgrades in the home, so we didn't get a dime over our original buying price, after living there five years."
Taylor and her ex-husband wanted $10,000 more, but they also wanted closure on the relationship.
"To hold out for a better counter offer, you need a capacity to play hardball at a time when you're emotionally bruised," she says. "Holding out for a better offer means more contact with your ex. We didn't have an ugly divorce, which is why I'm letting you print my last name, but we both just wanted out."
The house in question was unoccupied at the time of the sale. Both Taylor and her ex-husband were living elsewhere, outside Ottawa, occasionally using the home as a pied-à-terre.
"That's the worse thing you can do. Buyers and their agents smell the vulnerability," says Taylor.
"The house needs to look like a loving, happy environment. There need to be clothes in the closets and mail on the table," says Edmonton-based realtor and blogger Sheldon Johnson.
"Nothing says 'make me a lower offer' more than photos with some of the faces cut out. Nothing screams 'divorce' more than lawn chairs in the kitchen and a mid-life crisis car in the driveway."
If the sellers are coached properly, Johnson claims, they won't get low offers because their homes will be properly staged (Observe all those television shows on HGTV). Putting on a brave face can save you thousands of dollars.
"Clients selling a home in the middle of a divorce need a professional to coach them to act rationally," adds Johnson.
"You can't have a tempter tantrum and destroy everything you worked for. When buyers come to look at your property, they aren't just buying sticks and bricks; they're buying a home. They buy emotionally, and they don't want a stigmatized property. A house that looks like the cold battlefield of a divorce also signals the opportunity to low ball."
Nancy, 47, isn't giving buyers the chance. This Montreal-based scriptwriter who didn't want her last name used, is embroiled in a 21/2-year legal battle with her ex-boyfriend over the value of their home in downtown Montreal.
The real estate market is so precarious right now that she's afraid to put the house up for sale. Instead, she's trying to buy out her ex.
"It's no accident that my marriage broke down during a kitchen renovation," says Nancy, who requested anonymity to protect her two school-aged children.
"Our emotional problems are embedded in the house. Renovations test a couple's communication and we didn't survive. I knew he didn't want the new kitchen, but he OK'd the renovations to hide his affair. Instead of a new kitchen, he really wanted a sports car instead. I should've seen the red flag!"
Heartache can play havoc with people's decision-making abilities.
D.M., an editor at a film titling company, was so eager to split with his ex-girlfriend that he abandoned his stake in their home out of guilt for ending the relationship.
"I wasn't being magnanimous," says D.M., who wanted to conceal his full name to spare his ex's feelings. "For me, the house represented misery. We bought a cheap place at the dilapidated end of Dalhousie for $165,000, but there was a $1,500 emergency every month and I got laid off my job. We were there for two years, but I felt worse and worse about being in the house with her. When I finally announced I was leaving, she offered to return my part of the down payment, but I just wanted out. I gave her the washer and dryer, too."
Would he buy again?
"In a heartbeat -- with the right girl and enough cash," says D.M.
There it is again -- that love cycle. The cupid factor is equally strong when it comes to shaking up the real estate market.
"Love is one of the top reasons people buy real estate and marriage is a fantastic excuse to spend money on a home," says Montreal realtor and HGTV personality Tatiana Londono.
"But love is just as dangerous as divorce. It can cloud people's judgment just as much," says Londono.
"When people are in love and emotionally attached to the idea of buying a home and starting a life together, they will often want to buy something overpriced that they can't afford. Or, they'll want to buy beside a railway track or something too small or in a crappy neighbourhood. They need to be gently coaxed into acting rationally."
Joanne Latimer is a freelance writer and new homeowner.
© The Ottawa Citizen 2009
2 comments:
AM I profiteering? you betcha... but then again... not really. I got the house for what it's worth... it needs work. I will fix it, may be live in it, maybe flip it, and ensure the karma is good. It's a home not a house. That's my story and I am sticking to it!
I encouraged my son to do the same. He needs to refinance now while the house isn't in great shape and the market is depressed. His soon to be ex didn't take care of it and from what we can tell didn't spend much time there. She doesn't deserve to have anything come out of it.
~R
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